Bitcoin (BTC-USD) has once again proven that it’s a tricky asset to predict. On August 14, just when it seemed like BTC was ready to ride high on the back of favorable U.S. inflation data, the cryptocurrency took a sudden nosedive. The Consumer Price Index (CPI) for July, coming in at 0.2%, matched expectations and was supposed to buoy risk assets like Bitcoin. Instead, BTC’s price dropped by around 5%, falling below $59,000 from a high of $62,000 shortly after the CPI report. This abrupt shift demonstrates Bitcoin’s unpredictable nature and its tendency to defy usual expectations.
Bitcoin Reacts Unexpectedly to Positive News
Despite the CPI report indicating a slower rate of inflation—which traditionally supports higher asset prices—Bitcoin’s reaction was short-lived. After spiking to approximately $61,809 on Bitstamp, the cryptocurrency quickly lost steam, dropping over 3% within an hour. Daan Crypto Trades, a well-known trader, had previously cautioned about erratic price movements around U.S. macroeconomic data. He tweeted, “CPI coming in mostly at estimates. Pretty good and doubt this impacts markets much in the end.” This sentiment seemed to ring true as Bitcoin’s brief rally fizzled out, aligning with his earlier forecast.
What’s Next for Bitcoin?
Looking ahead, some traders are cautious. Roman, another prominent figure in the crypto community, suggested on X that Bitcoin might fall further. He noted, “Looking for price to hit 58 & possibly 55k before potentially taking longs.” This perspective reflects concerns about the market’s current lack of volume and resistance at higher levels.
Meanwhile, the broader market anticipates the Federal Reserve will cut interest rates in September, as indicated by CME Group’s FedWatch Tool. The hope is that lower rates will eventually support risk assets, including cryptocurrencies.
What Is BTC’s Price Right Now?
At the time of writing, Bitcoin is sitting at $59,484.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
